A Company Recently Lowered Its Service Performance from 99 Percent

question 23

Multiple Choice

A company recently lowered its service performance from 99 percent product availability to 97 percent product availability.The change saved the company exactly $1 million per year in inventory carrying cost.Senior management now wants to lower the service level to 95 percent from 97 percent.Such a further change is likely to save:

• A)Less than $1 million.
• B)Exactly $1 million.
• C)More than $1 million.

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Definitions:

Hazards

Potential sources of harm or adverse health effect on a person or persons.

Alcohol

A psychoactive substance found in beverages such as beer, wine, and spirits, known for its intoxicating effects.

Benefits

Advantages or positive effects that occur as a result of a specific action, treatment, or policy.

Social Learning Model

A theory that suggests individuals learn new behaviors through observing and imitating others, alongside reinforcements and punishments.